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Presley wants to buy a new scooter, which is priced at 28,500. She goes to her neighborhood bank to apply for a simple interest loan. The bank offers her the loan with all of the money at a 6.2% interest rate p.a. over a 5 year period. What is the total price she pays for the scooter?

Solution

Presley wants to buy a new scooter, which is priced at 28, 500. She goes to her neighborhood bank to apply for a simple interest loan. The bank offers her the loan with all of the money at a 6.2% interest rate p.a. over a 5 year period. What is the total price she pays for the scooter?

Solution

Principal : 21755.73

Solution steps

Translate the problem into an equation:

28500 = P (1 + 0.062 \cdot 5)

Solve for

P, 28500 = P (1 + 0.062 \cdot 5) : P = 21755.73

Principal : 21755.73

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